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TMI Blog2022 (11) TMI 206X X X X Extracts X X X X X X X X Extracts X X X X ..... cs are trimmed and then wound on steel pipes on a winder. Same way, the other side of the fabric is also coated /laminated to form a waterproof fabric. For increasing thickness of such fabric, one side coated/laminated fabrics are sandwiched laminated with a film and then laminated again with one more layer of fabric to form a coated/laminated fabric of higher thickness. Thereafter overlap sealing is done to increase the width of the coated/laminated fabric, and they are cut in required length to obtain required size of Geomembranes. Woven Fabrics from HDPE Strips and Tapes of less than 5 mm of Heading 5404 shall be covered under Heading 5407 20 of the HSN. The above Woven Fabric is subjected to sandwich lamination of plastics and brings into existence a new product viz. Geomembranes pond lining fabrics. The said Geomembranes pond lining fabrics are supplied in piece form or are in cut to length as per the specification of customer. In view of technical uses of Geomembrane, Geomembrane passing the test of Section note XI( 1 )(g) to Section XI, Geomembrane satisfying the test of Chapter 59 Note 7(1 )(a); it is concluded that 'Geomembrane' is a textile article. The view ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are melted in Extruder by applying heat and friction, and they are extruded in form of thin sheet, in molten form. Such thin sheet in molten stage is passed through a quenching tank containing water, to form a solid thin sheet, which is then slit into tapes/strips. Such slit tapes/strips are passed through hot plate for orientation process so as to impart strength. The width of such tapes/strips is below 5 mm. and they are wound on metal pipes for producing bobbins. (b) These tapes/strips are then loaded on circular looms or flat looms for weaving purpose. By employing weft and warp method of weaving, woven fabrics are produced by using the tapes/strips of width below 5 mm. These are uncoated woven fabrics of plastic; and such fabrics in rolls are further processed for producing coated/laminated fabrics on extrusion lamination machine within the applicant factory. (c) Rolls of uncoated fabrics loaded on extrusion lamination machine are drawn for feeding into the laminating unit. Mix of Low Density Polythene (LDPE), LLDPE and colour/black master batch is fed into the extruder through a Hopper, and melted by applying heat and friction, for forming a thin film in a molten state. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssification for the products viz. Geomembrane, because the product is textile products for technical uses. The product is in the nature of textile fabrics coated or laminated with plastic processed further, and used for technical purposes. Further submitted that none of the exclusions provided under any of the Notes to the relevant Chapters of the Tariff is attracted for classification of the goods in question, and therefore the goods in question are not excluded from Chapter 59 of the Tariff for classification. 6. The applicant has submitted the scope of Heading 5911 as follows:- i. Textile products and articles, for technical uses, specified in Note-7 to Chapter- 59 are covered under Heading 5911 by virtue of the broad description of the goods for this heading. Textile fabrics coated, covered or laminated with rubber, leather or other material used for technical purposes are specified against Sub Heading 59111000. It is explained under note (1) of part (A) of Heading 59.11 of HSN that 'other material' includes plastics. Sub Heading 591190 covers other textile products and articles, for technical uses, specified in Note-7 to Chapter 59. ii. A plain reading of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arieties of yams and fabrics are produced out of plastic materials, namely, terelene, polyester, nylon, acrylic, texturized yarns, silicon yams, etc. As held by the Hon'ble Apex Court, phenomenal advancement in science and technology would result in different and new variety of fabrics manufactured from materials unknown or unthought of till a particular time; but fabrics produced out of any such materials by weaving were textile fabrics i.e. textile products. 8. The applicant submits that Geomembranes are manufactured by weaving of fabrics on circular looms as well as flat looms. Geomembranes are in the nature of fabrics which are processed further for imparting strength, water proofing quality and such attributes; but the basic nature of both the products is that of fabric. Geomembranes are produced out of plastic material, but fabrics produced out of plastic material are textile fabrics i.e. textile products. 9. The applicant submits that Fairchild's Dictionary of Textiles is considered to be the most reliable book on textile terms and their meaning. The term 'textile' is explained therein as a word derived from the Latin term textilis , based on the verb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be anything like cotton, silk, rayon, nylon or any other description or made out of any other material. But when any such material was woven into fabric, what came into existence was a textile. 12. The applicant has further submitted that it is clear from the judgements of the Hon'ble Supreme Court as well as the Hon'ble Gujarat High Court that textiles means any woven fabrics, and weaving adopted may be simple warp and weft pattern or it could be any other process or technique. It is also clear that fabrics produced by weaving technique were textiles, and they were to be treated as textile fabrics even for the purpose of taxing statute. Even in common parlance, fabrics are considered to be those goods which are produced as a result of any weaving methods because all woven fabrics are considered to be textile goods or textile fabrics among the people producing such goods, people dealing in such goods, people using such goods and people connected with textile trade. The applicant has placed reliance on the ruling pronounced by the Gujarat Authority of Advanced Ruling in the case of M/s. Texel Industries Ltd. Vide AAR No. GUJ/GAAR/R/2022/11 dated 07.03.2022 wherein i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e High Court. Textile products and articles 17. The applicant submits that woven fabrics come into existence at intermediate stage, and such woven fabrics are processed further to manufacture textile fabrics coated or laminated with plastic for using in respect of technical purposes. The intermediate product, namely, woven fabrics fall under Heading 5407 of the Tariff. Such textile fabrics are processed further as aforesaid. Further submits that Note-1 of Chapter 59 clarifies that the expression ''textile fabrics applies to woven fabrics of Chapters 50 to 55 and a few other products specified in the Note. Woven fabrics of Heading 5407 are thus textile fabrics in view of this Note also. When such textile fabrics are processed further and textile products/articles in the nature of textile fabrics coated or laminated with plastic meant for being used for technical purposes are manufactured, such textile products/articles merit classification under Heading 5911 of the Tariff. Products and Articles 18. The applicant submits that the broad description of goods under Chapter 59 of the Tariff clarifies that the goods covered there under are Impregnated, Coated, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on'ble Supreme Court has observed that the word product was defined in Webster's Comprehensive Dictionary as anything produced or obtained as a result of some operation or work. 20. The applicant submits that the Appellate Tribunal, Delhi in case of M/s. Bharat Rubber Regenerating Co. Ltd. V/s. Collector of Central Excise, 1984 (18) ELT 85, has observed that reclaimed rubber sheets having come out of a definite process of manufacturing or production, they were a product in their own right. It is also observed by the Appellate Tribunal that milk was a product but when we talk of milk products , we do not include therein milk itself but only the products made out of milk. On that basis, the Appellate Tribunal held that rubber was also a product, but the expression rubber products would include products made out of rubber and not rubber as such. 21. Shree Ambica submits that there are several other decisions and judgements on the meaning of these two terms, namely, product and article, but the common thread running through such case law is that a product was an article produced or obtained as a result of some operation or work. 22. The applicant submits that in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... technical purposes are any of the fabrics which have been made up and also textile fabrics and felts of a kind used in paper making or similar machines. It is also explained under HSN that the textile articles of this Heading may incorporate accessories in other material provided the articles remained essentially the articles of textile. 26. The applicant submits that the operations like overlap sealing, stitching, cutting and sealing edges, affixing eyelets, etc. are the operations/processes undertaken by the applicant on textile fabrics for producing Geomembrane. Such operations and processes are undertaken within the factory of production where textile fabrics are produced first, and then they are processed further by subjecting them to various operations as shown in the product brochures. The uses of these products are not ordinary uses of textile fabrics, but Geomembranes are used for technical purposes. Heading 5911 of the Tariff is therefore most appropriate for Geomembrane; because they are textile products and articles for technical uses. 27. The applicant submits that Woven fabrics emerging at intermediate stage in its factory are admittedly produced from strip of p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the product 'Laminated HDPE Fabric for canal lining' (Type-I) wherein 'width of Tape' is mentioned 3.1 mm C.L. Ref, Result obtained 3.0 mm and Remarks mentioned 'complies'. 30. Question on which Advance Ruling sought 1. Whether the product, namely, Geomembranes merits classification under Heading 5911, Sub Heading 59111000 or Sub Heading 59119090, as Textile products, coated, covered or laminated with plastic, used for technical purposes? Personal Hearing 31. Personal hearing granted on 8-7-22 and 26-9-2022 was attended by Shri Hem chhajed, CA and he reiterated the submission. Revenue's submission: 32. Revenue has neither submitted its comments nor appeared for hearing. Discussion and Findings 33. We have considered the submissions made by the Applicant in their application for advance ruling as well as the submissions made by authorised signatory, during the personal hearing proceedings on 26-9-2022 before this authority. We also considered the issue involved, on which advance ruling is sought by the applicant, relevant facts the applicant's interpretation of law. 34. At the outset we would like to make it c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r of fabric to form a coated/laminated fabric of higher thickness. Thereafter overlap sealing is done to increase the width of the coated/laminated fabric, and they are cut in required length to obtain required size of Geomembranes. 36.5 Now we discuss the flow of classification for the above products which are arising during the course of manufacturing. The first product which comes into existence is the HDPE Tapes Less Then 5 mm in Width and Note 1 (g) of Section XI (Textile and Textile Articles) excludes only strips of plastic where the width is exceeding 5 mm. The said wording read as under:- Note 1 (g) of Section XI (Textile and Textile Articles) 1. This Section does not cover: (a) .............................. (g) Monofilament of which any cross sectional dimension exceeds 1 mm or strip or the like (for example, artificial straw) of an apparent width exceeding 5 mm, of plastics (Chapter 39), or plaits or fabrics or other basket ware or wickerwork of such monofilament or strip (Chapter 46) . From the above Section Note 1(g) to Section XI, it would be observed that Plastics Strips of width less than 5 mm shall be covered under Section XI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to sandwich lamination of plastics and brings into existence a new product viz. Geomembranes pond lining fabrics. The said Geomembranes pond lining fabrics are supplied in piece form or are in cut to length as per the specification of customer. 36.9 In this regard, we note that the Strips made from HDPE granules, have width less than 5 mm and are then weaved. Thus Section note 1(g) to Section XI-Textile and Textile Articles has been complied with. The phrase Tor technical use' is mentioned in the Chapter Notes to HSN 5911. Heading 5911 is read as under :- 5911 - Textile products and articles, for technical uses, specified in Note 7 to this Chapter; such as Textile fabrics, felt and felt lined woven fabrics, coated, covered or laminated with rubber, leather or other material of a kind used for card clothing, and similar fabrics of a kind used for other technical purposes, including narrow fabrics made of velvet impregnated with rubber, for covering weaving spindles (weaving beams); Bolting cloth, whether or not made up; whether or not impregnated or coated, of a kind commonly used in other machines, Cotton fabrics and articles used in machinery and plant, Jute fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for technical purposes are included in this Chapter, we hold that the goods Geomembrane, though coated with Plastic but used for technical purposes finds place in the Tariff 5911, for the dual reason that the phrase 'other materials' used in this Tariff is vast to include plastics also; coupled with the technical use of Geomembrane. 36.12 We find that in Clause (A) of HSN 59.11 of Harmonised System of Nomenclature (Page No. XI-5911-1) has mentioned that in other material' includes plastic also. Clause (A) of HSN 59.11 of HSN is reproduced as under:- (A) Textile Fabrics and other textile products, for technical uses, in the piece, cut to length or simply cut to rectangular (including square) shape Provide that they do not have the character of the products of heading 59.08 to 59.10, these products are classified here (and not in any other heading of Section IX), whether in the piece, cut to length or simply cut to rectangular (including square)shape. This group covers only the textile fabric and other textile products as defined in Note 7 (a) to the Chapter, and listed at (1) to (6) below. (1) Textile fabrics, felt and felt-lined woven fabrics, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that,- Geomembranes for water proof lining - Classification of - Laminated High Density Poly Ethylene HDPE Woven Geomembrane for water proof Lining Type-II, IS:15351:2015 - Product known in market as agro textiles - Main product around which whole process of manufacturing revolves is HDPE Woven Fabrics - Perusal of Chapter Note 1 to Chapter 39 of Customs Tariff Act, 1975 making it clear that textile materials of Section XI excluded from scope and terms of plastics and cannot be covered under scope of Heading 3926 of HSN - HDPE Tapes/Strips of less than 5 mm specifically covered under HSN Heading 5404 as Synthetic Textile Material and specially woven fabrics from said HDPE Tapes/Strips covered under HSN Heading 5407 20 - HDPE Woven Fabrics referred as Woven Fabrics made from Synthetic Textile Material subjected to LDPE Coating and Lamination referred as Sandwich Lamination - Two or more pieces of said Sandwiched Laminated Geomembrane fabrics joined/seamed together by a suitable heat air blower scaling process keeping into requirement of customer based on which said fabrics cut and joint and cut sealed as per standard sealing process to be used as pond liner - Such Laminate ..... 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